Explaining McAllen – It’s Disease Burden

Gawande’s McAllen continues to reverberate throughout the Land of Orszag, which is home to health care reform, but I have been spending more time in the Land of Gilden, where reason abounds. Because you may not have seen it on the Health Care Blog, I have reproduced Dan Gilden’s key illustration, which relates spending by Medicare beneficiaries to their risk scores, using a system developed by JEN Associates Inc. based on Medicare physician and hospital claims. In McAllen, as in El Paso (Gawande’s favorite) and in Grand Junction CO (which is a favorite of the Dartmouth group), spending relates to the burden of disease. Patients in McAllen are sicker and poorer, and that leads to much higher spending. So let’s get it straight. The waste and inefficiency in our system is more a human cost than a financial one, although it certainly is the latter, and we won’t fix the latter until we learn how to fix the former. The reason that the US spends more and gets less is that social failure is expensive, and we have more than any developed country.